Contracts Commons^™

The New Social Contract: An Inquiry Into Modern Contractual Relations, Michigan Law Review

Michigan Law Review

A Review of The New Social Contract: An Inquiry into Modern Contractual Relations by Ian R. Macneil

A Tale Of Two Laws, Barbara A. Black

Michigan Law Review

A Review of The Rise and Fall of Freedom of Contract by Patrick S. Atiyah

The Interlocking Death And Rebirth Of Contract And Tort, Jeffrey O'Connell

Michigan Law Review

The first portion of this article will examine the growing inclination of courts to apply tort principles to cases based on contracts; at the same time, the defects of tort will be discussed insofar as they militate against the wisdom of so extending tort principles. In the last half of the article, an alternative contractual method for allocating losses in one particular area will briefly be presented; this method does not contain the defects in loss allocation that have impelled courts to reject traditional contractual principles, but it also avoids many inefficiencies of traditional tort remedies.

Residential Tenants And Their Leases: An Empirical Study, Warren Mueller

Michigan Law Review

Of particular interest is the application of this theory to residential leases, a classic example of the standard long-form contract. An abundance of traditional legal research and commentary has been devoted to the problem of disparity of bargaining power between the parties to a standard-form residential lease. The commentators have consistently called for reform measures to combat this problem. In order to adopt sensible and effective reform measures, however, it is first necessary to obtain factual data with which to test and clarify the reformers' underlying assumptions. Such data is virtually nonexistent, since, prior to the study described in this …

Contracts--Consideration--Inadequacy Of Consideration As A Factor In Determining Unconscionability Under Section 2-302 Of The Uniform Commercial Code, Michigan Law Review

Michigan Law Review

Section 2-302 of the Uniform Commercial Code (Code) provides that a court may refuse to enforce all or part of a contract if it finds that the contract, or any part of it, was unconscionable when made. In American Home Improvement, Inc. v. MacIver the Supreme Court of New Hampshire apparently held that a price substantially in excess of the value of the goods and services sold was sufficient in itself to constitute unconscionability under this provision of the Code. The high price was at least in part attributable to high time-credit charges, and, as noted by the court, the …

The Labor Court Idea, R. W. Fleming

Michigan Law Review

When the War Labor Board first began to exert pressure on companies and unions to adopt grievance arbitration clauses during World War II, there was a considerable hesitance on both sides. Both groups worried that while third party decision making might momentarily improve productive efficiency, it would do so at the price of a long-run loss in institutional integrity and autonomy, and peace at any price held little fascination for either side. Nevertheless, grievance arbitration was accepted and gradually became the normal mechanism for resolving contractual disputes in the United States.

Government Contracts-Adoption Of Uniform Commercial Code As The Applicable Federal Law In An Action For Breach Of Government Contract-United States V. Wegematic Corp., Michigan Law Review

Michigan Law Review

Appellant contracted to supply the Federal Reserve Board with a "truly revolutionary" electronic digital computing system. After twice requesting postponement of the delivery date, appellant informed the Board that delivery under the terms of the contract would be impracticable because of unforeseen engineering difficulties that would require at least one year and one million dollars to overcome. Appellant asked for cancellation of the contract, but the Board refused and brought a suit for damages. Both parties conceded that federal law governed the action; appellant, however, argued that section 2-615 of the Uniform Commercial Code (Code) should be adopted as the …

Secured Transactions-Insurance-A Security Interest In The "Proceeds" Of Secured Collateral Does Not Include Insurance Proceeds-Universal C.I.T. Corp. V. Prudential Investment Corp., Michigan Law Review

Michigan Law Review

In return for a loan, a debtor executed a promissory note to codefendant, Prudential Investment Corporation, and entered into a written agreement to secure this note, designating as collateral a semi-tractor and the proceeds therefrom. Under this type of arrangement, Prudential's security interest would attach automatically to any property received from a sale, exchange, or other disposition of the tractor. Petitioner, Universal C.I.T. Corp., held the conditional sales contract which was executed in financing the purchase of the tractor and was named as loss payee in the insurance contract covering the tractor. When the tractor was totally destroyed, petitioner collected …

Reformation And The Parol Evidence Rule, George E. Palmer

Michigan Law Review

The parol evidence rule of itself is never an obstacle to reformation, provided there is satisfactory evidence of a mistake in integration. If the parties intend to express the terms of a transaction in a writing, which is then to be looked to as the sole repository of those terms, the longstanding tradition of the law courts, described as the parol evidence rule, has been that the writing is controlling. If through mistake the writing failed to express correctly what the parties meant to express, the law courts still regarded the written word as decisive, but it has been recognized …

Reformation And The Statute Of Frauds, George E. Palmer

Michigan Law Review

There is unnecessary confusion and difference of opinion over the effect of the statute of frauds as a bar to reformation that would otherwise be available in connection with bargain transactions. Both the confusion and the conflict could be eliminated if it were clearly perceived that a decree of reformation is not the enforcement of an oral contract. Instead, it is a correction of the writing in question, or more basically a recognition that the legally significant agreement is the one the parties intended to express or describe in the writing. It is a separate question whether the writing as …

Article Eight: A Premise And Three Problems, Ernest L. Folk Iii

Michigan Law Review

This essay concerns itself with a basic premise and three problems concerning investment securities under Article Eight of the Uniform Commercial Code (Code). Although some amount of relevant exposition is necessary to make the arguments intelligible, general familiarity with the essentials of the Code's treatment of investment securities is assumed.

Actions On Commercial Paper: Holder's Procedural Advantages Under Article Three, Stanley V. Kinyon

Michigan Law Review

The discussion will also be concerned primarily with the usual action "on the instrument": an action by the holder to enforce payment by a person who has signed it as maker, acceptor, certifier, drawer, indorser, or guarantor and has thus become "liable on" it. These instruments, of course, may be involved in other types of actions, such as: an action for conversion of the instrument (section 3-419); an action to recover damages for breach of the warranties of a collector or transferor (sections 3-417 and 4-207); an action to compel indorsement (section 3-201); an action to enjoin payment (section 5-114(2)(b)); …

Protection Of The Installment Buyer Of Goods Under The Uniform Commercial Code, Robert H. Skilton, Orrin L. Helstad

Michigan Law Review

The present topic for discussion, protection of the installment buyer under the Code, is part of a larger topic-protection of the consumer under the Code. The remarks that follow sometimes apply generally to the status of the consumer under the Code. There are times when no distinction should be made between our model installment buyer and other consumer buyers.

The Effect Of Misunderstanding On Contract Formation And Reformation Under The Restatement Of Contracts Second, George E. Palmer

Michigan Law Review

The presence of misunderstanding at the time of an apparent agreement creates difficult problems in the law of contract formation and equally difficult problems when the apparent agreement is in ·writing and reformation is sought. The rules formulated in the original Restatement of Contracts are unsatisfactory in both areas. The preparation of the Restatement Second, which is now under way for contracts, includes changes in the rules of contract formation but the changes emerging are no more satisfactory than the original rules. The current version of the Restatement Second, contained in Tentative Draft No. 1, accepts the …

The Contractual Aspect Of Consumer Protection: Recent Developments In The Law Of Sales Warranties, William C. Pelster

Michigan Law Review

As might have been expected, the courts have not confined their efforts in updating the law of products liability to fostering innovations in that segment dealing with warranties. The struggle to impose strict tort liability upon a manufacturer for harm caused by his defective products has made significant advances and is continuing: However, the citadel has yet to be taken. Indeed, even the California Supreme Court, which may be considered the leading proponent of this strict tort theory, has limited its availability so that only those seeking redress for harm to person or property may invoke the doctrine; thus, a …

Insurance--Motor Vehicles--"Newly Acquired Automobile" Clause Extended To Cover Previously Owned Inoperable Vehicles--National Indem. Co. V. Giampapa, Michigan Law Review

Michigan Law Review

Plaintiff insurance company brought an action for a declaratory judgment that it be held not liable on a policy it had issued to the insured motorist. A party injured in an accident involving the insured had obtained a judgment against the insured in a suit which the insurer defended with a reservation of rights. Although a 1949 Cadillac was the "Described Automobile" in the insurance policy, the insured was driving a 1956 Ford at the time of the accident. The trial court found that during the term of the policy the Cadillac had become inoperable and was replaced by the …

Commercial Law--A Farmer Is Not A "Merchant" Under The Uniform Commercial Code--Cook Grains, Inc. V. Fallis, Michigan Law Review

Michigan Law Review

Plaintiff grain company allegedly entered into an oral contract to purchase 5,000 bushels of soybeans from the defendant farmer. The grain company signed a written integration of the alleged oral agreement and mailed it to the farmer, with a request for his signature. The farmer neither signed the document nor attempted to communicate with the grain company and later refused to deliver the soybeans pursuant to the terms of the plaintiff's memorandum. In an action for breach of contract, the grain company contended that the farmer was precluded from relying on the statute of frauds, as incorporated in the Uniform …

Contracts--Expanded Application Of Promissory Estoppel In Restatement Of Contracts Section 90--Hoffman V. Red Owl Stores, Inc., Michigan Law Review

Michigan Law Review

Plaintiff sought a franchise for a Red Owl supermarket and was told by an agent of the defendant that $18,000 would be sufficient to finance such a venture. Acting on the advice of the agent, plaintiff purchased a small grocery store so that he could gain experience in food store management. Having been assured that "there would be no problems in establishing him in a bigger operation," plaintiff sold this store after three months of doing business and realized a net profit of approximately $500 on the purchase and sale. In further preparing for the franchise, plaintiff sold a bakery …

Prior Lien On Rents And Profits Upheld As A Method Of Financing Repairs- In Re Dep't Of Bldgs., Michigan Law Review

Michigan Law Review

Official findings of the New York Legislature in 1962 revealed the existence in certain cities of housing conditions which, unless immediately corrected, might cause irreparable damage to buildings or endanger the life, health and safety of their occupants or the general public. To facilitate the correction of these conditions and to increase the supply of adequate, safe dwelling units, the legislature enacted the 1962 Receivership Law, which creates a procedure enabling a city to enforce its housing codes by compelling needed repairs and improvements.

The Supreme Court And Labor Dispute Arbitration: The Emerging Federal Law, Russell A. Smith, Dallas L. Jones

Michigan Law Review

Within the past few years, the United States Supreme Court has handed down a number of decisions of great significance to the labor dispute arbitration process. Some have been concerned with problems of arbitrability or arbitral authority; others with the availability and exclusivity of the arbitration process vis-a-vis alternative legal remedies for breach of the labor agreement; and still others with the effect of a breach of obligation by one party to the labor agreement upon the obligations of the other party. We propose in this article to analyze these decisions, to attempt to categorize the different kinds of challenges …

New Values Under Old Oil And Gas Leases: Helium, Who Owns It?, C. Douglas Kranwinkle

Michigan Law Review

It is a well known maxim among oil and gas lawyers that "a producing well always clouds a title and a dry hole cures it." A variation of that maxim might be applied to producing wells which may or may not include, as by-products of the primary mineral, other substances that are extractible and valuable. Of course, once production of by-products begins, conveyancers give special attention to these resources, but many instruments executed before such development may be phrased in general terms without specific mention of substances unimportant when the conveyance was made. Even a recent instrument may lack specificity …

Civil Procedure- Venue-Effect Of Contract Provision Fixing Venue As To Future Litigation, Robert C. Bonges

Michigan Law Review

Defendants, residents of Harris County, Texas, executed in Harris County a conditional sale contract to purchase a food freezer from plaintiff's assignor. One of the contract provisions was that any suit on the contract was to be tried in Travis County, Texas. Plaintiff subsequently brought an action on the contract in Travis County, and defendants, contrary to their agreement, requested the trial court to transfer the action to a court of proper jurisdiction in Harris County, which was the proper county for suit under the applicable venue statute. In response, plaintiff argued that, since the contract created an obligation performable …

Compulsory Oil And Gas Unitization: Effect On Overriding Royalty Obligations- A Hypothetical Judgement Of The High Court Of Juristic Review In Peter Fox Brewing Co. V. Sohio Petroleum Co., Maurice H. Merrill

Michigan Law Review

Jus, Chief Justice. As should be well known, our practice is to sit in review of decisions presenting elements of difficulty, and concerning the propriety of which there seems reason for doubt. We have no jurisdiction to reverse, to modify, or to affirm. Our judgment must be confined to approval or to disapprobation, or to some position between these two extremes.

Notice Requirements Of Guaranty Contracts, Richard F. Dole Jr.

Michigan Law Review

The following is an attempt to verify Corbin's educated guess through the application of factual analysis. If significant facts can be isolated which produce the same result regardless of the theory applied by the court, no real conflict can be said to exist. An initial exploration of the problems involved is a prerequisite to delineating the area in which factual analysis must be used.

Reflections On The Nature Of Labor Arbitration, R. W. Fleming

Michigan Law Review

The use of arbitration as a means of settling labor-management disputes has increased steadily in the past twenty years. Recent decisions of the Supreme Court have underlined the importance of the process. The natural tendency is to compare labor arbitration with the court system as an adjudicatory process. There are, however, significant differences between the two, and this needs to be better understood.

An intelligent evaluation of the differences, and of the labor arbitration tribunal in general, can be made only after an exploration of its origin and history, and after some consideration of the kinds of cases which are …

A Radical Restatement Of The Law Of Seller's Damages: Michigan Results Compared, Robert J. Harris

Michigan Law Review

Conventional doctrine does not address itself directly to the choice among valuation techniques, although the various parochial damage formulae give some clues. Underlying this series of articles is an assumption that the doctrine makes more sense when restated in valuation terms. These articles involve an effort to restate in such terms one sector of expectation damage law-the part that governs cases in which plaintiff is a "seller."

Attorney And Client- Attorney's Rights Under Contract Of Partial Assignment-Effet Of Premature Termination Or Settlement Of Action, Charles Frederickson S.Ed

Michigan Law Review

In an action for personal injuries, defendant caused a subpoena to be served upon plaintiff requiring him to appear to give his deposition. Plaintiff wholly failed to appear, and no cause was shown for such failure. Defendant then filed a motion for dismissal of the suit pursuant to subsection (c), 215a, of the Texas Rules of Civil Procedure, and notice thereof was served upon plaintiff. Although plaintiff again made no appearance, his attorneys moved to intervene, asserting the contingent interest in the cause of action acquired by their contract with plaintiff. The trial court denied the motion for intervention and …

Labor Law-Collective Bargaining Agreements-Implied Limitation On Management's Right To Subcontract, A. Paul Victor

Michigan Law Review

During the existence of a collective bargaining agreement which included both exclusive recognition and union shop clauses but did not include a management prerogatives clause, defendant employer, without the consent of the plaintiff union, contracted out janitorial work which had previously been performed by three of its employees. Subsequently, these employees were laid off and the plaintiff's protest, though in compliance with all grievance procedures, was unsuccessful. Thereupon, the plaintiff sought declaratory judgment relief under section 301 of the Labor-Management Relations Act, alleging that the defendant had no right to subcontract work customarily performed on its premises by its employees …

The Extension Of Insurance Subrogation, Spencer L. Kimball, Don A. Davis

Michigan Law Review

When an insured loss occurs under circumstances that make a third person liable to reimburse the insured, there are various possible ways to adjust the loss among the three persons involved. One solution would permit the policyholder to recover both on the insurance and from the third person, i.e., would permit double recovery for the loss. A second solution would give the third person the benefit of the insurance by denying recovery from him. A third solution would subrogate the insurer to the policyholder's rights against the third person. Combinations of these three solutions are possible by applying sometimes …

Insurance-Rate Regulation-Construction And Effect Of Guaranty Bond Agreement, Robert L. Harmon

Michigan Law Review

Plaintiff, an insurance agents' association and several other insurance companies and associations, instituted an action attacking an order of the State Board of Insurance. The order approved a guaranty bond form, together with rates and rules, which had been submitted to ,the Board pursuant to statute by the defendant insurance company. The guaranty agreement was an arrangement whereby defendant guaranteed payment of losses under fire insurance policies of other insurers in the event the latter should be unable to pay. Although the bond form was not restricted to any specific original insurers, it was contemplated that defendant would use ,the …